InsideTrack - 2004-12-06

BA To Offer Additional Discounts For Online Bookers
British Airways last week said it will consider negotiating additional discounts for corporate clients that adopt high rates of self-service processing for their passengers. The airline is mounting a big push to transfer pre-flight administration from customer service staff at the airport to passengers completing formalities through the ba.com Web site. Online tasks include checkin, seat selection, ordering of special meals and completing advance passenger information to meet the requirements of U.S. immigration. Now the list is growing to include passengers printing their own boarding cards before reaching the airport, a facility that is available from 38 European airports plus London City and London Heathrow—the latter for domestic flights only. David Noyes, recently promoted from BA's head of sales and marketing for North America to head of sales for the U.K. and Ireland, said corporate clients with a high degree of self-service would be looked on favorably during negotiations. "That could become part of the deal," he said. "If we can change behavior, we can drive efficiencies through the whole business, and if we can do that, we can get benefit for everybody."

German Bank Stake IN TQ3 Parent TUI
German bank Westdeutsche Landesbank last week sold its $1.3 billion, 31.3 percent stake in TUI, the German travel giant that owns TQ3 Travel Solutions. The sale was mediated by Deutsche Bank, which disposed of 10 percent to Spanish hotel group Riu Hotels and another 7 percent to a second Spanish hotel group and Valencia-based bank Caja de Ahorros del Mediterráneo. The bank placed the remaining 14 percent with institutional investors. The strategic significance for TQ3 is unclear. On one hand, the disposal of WestLB's stake could clear the way for TQ3 to buy its U.S. partner Navigant, a move previously ruled out by TQ3's significant ownership by a foreign bank. On the other hand, TUI's interest in business travel may wane now that its leading shareholder is a leisure hotel group. TQ3 was not prepared to comment as BTN went to press.

Amadeus Selects Four Bidders For Potential Sale
Amadeus' airline shareholders last month narrowed the field of bidders to four for a potential leveraged buyout that could see a financial investor restructure the company's capital. Finalists include BC Partners, Cinven, Carlyle—jointly with CVC Europe—and Worldspan co-owner Citigroup Venture Capital US. "A GDS is a classic, textbook example of how synergies will come about," said Worldspan CEO Rakesh Gangwal during a conference call with investors last month. "If four went down to three, you would see lots of costs coming out and passed to customers in the form of lower booking fees." Final offers for a piece of Amadeus—partially owned by Air France, Iberia and Lufthansa—are expected in the next few months.

IRS To Raise Mileage Reimbursement Rate
The Internal Revenue Service beginning Jan. 1 will up its allowable reimbursable driving rate for travelers who use personal vehicles for business to 40.5 cents per mile from 37.5 cents. The rate increase largely is due to higher gas prices throughout the year. According to a BTN survey of 236 expense managers (see story), 82 percent of companies use this IRS safe harbor rate when reimbursing drivers. The rate is set once a year by the government using data from Runzheimer International. According to Runzheimer and IRS, the rate is not intended to be the standard for reimbursement that it has become. "The IRS rate was never meant to be a reimbursement number, but I don't know if anybody knows that," Lee Czarapata, director of client relations at Runzheimer International. "It's meant to be a safe harbor tax deduction guideline for people who don't keep receipts."

Carlson, CWT Combine Online Booking, Meetings Tools
Carlson Marketing Group and Carlson Wagonlit Travel last week announced the integration of their respective meetings management technology and online travel booking tool. The software enables integrated, end-to-end meetings management for meeting planners by combining Carlson Marketing's Web-based MeetingsLogic with CWT's Symphonie online booking and profile management tools. The integrated product is aimed at providing companies with improved convenience, higher online adoption and cost savings for group air transactions, and could boost leverage with group hotel suppliers. New features include automatic capture of meeting air spend per meeting, and single sign-on from registration through online booking. "Meeting planners have never had such a powerful tool at their disposal," said Peter Moen, vice president of business development at Carlson Marketing.